Here comes BJ's Wholesale Club's IPO...


BJ’s Wholesale Club, a Costco and Sam’s Club competitor, will begin trading on the New York Stock Exchange Thursday.

The initial public offering isn’t the chain’s first time to going public. BJ’s was previously listed on the NYSE before going private in 2011, when it was purchased by Leonard Green & Partners and CVC Capital Partners for $US2.8 billion. The current owners will retain a majority stake of roughly 69%.

The IPO priced at $US17 per share and is expected to bring in $US637.5 million, the company said late Wednesday.

BJ’s wants to use the money raised on Thursday to repay some of its debt, which totals $US2.4 billion, according to the prospectus. The company made a $US50.3 million profit for the year ended February 3, 2018, on $US12.75 billion in revenue. That translates to earnings of $US0.59 per share, the company said.

Groceries have been a a hotly contested space ever since Amazon entered the industry in 2017 with its $US13.7 billion purchase of Whole Foods. Walmart and Kroger, the nation’s two largest grocery chains, responded in kind by beefing up of their online shopping, pickup, and delivery options.

Costco, arguably BJ’s largest competitor, has also launched delivery options to compete with Amazon, but customers have complained about delivery fees, which can add up on individual items before the threshold for free delivery is hit.

Bank of America Merrill Lynch, Deutsche Bank, Goldman Sachs, and JPMorgan all provided banking services for the listing.

This story will be updated once BJ’s begins trading.

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